Medicare Advantage Premiums May Fall — Yet 5 Other Costs Could Rise

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Millions of retirees may see Medicare Advantage premiums move lower in 2027, but that does not mean overall healthcare costs will automatically become more manageable. A smaller monthly premium can look attractive until a hospital stay, specialist appointment, or prescription refill shows that other charges have increased. For older Americans on fixed incomes, those added expenses can quickly outweigh any premium savings.

According to the Centers for Medicare & Medicaid Services (CMS), the average monthly Medicare Advantage premium is expected to drop 16.5%, from $14.37 in 2026 to $12 in 2027. That is welcome news for beneficiaries dealing with higher living costs. Still, Medicare Advantage pricing includes far more than just the monthly premium. Plans may alter deductibles, copayments, provider networks, and other expenses from year to year. Before renewing automatically, here are five costs worth checking during Medicare open enrollment.

1. Hospital Copayments Could Rise

Hospital care is one of the costliest services retirees may need, and Medicare Advantage plans can require daily copayments for inpatient stays. KFF’s Medicare open enrollment analysis notes that these charges differ by plan and may apply for several days during a hospital admission. For example, a retiree whose plan charges $300 per day for the first five days would face a $1,500 bill before accounting for anything else.

Even if the monthly premium falls by $5, the yearly savings of $60 would cover only a small portion of that expense. When comparing plans for 2027, it is important to look closely at the inpatient hospital copayment schedule instead of focusing only on the premium.

2. Specialist Visits May Cost More

A plan with a $0 premium can still charge members every time they see certain providers. Specialist visits matter especially for retirees managing diabetes, heart disease, arthritis, or other chronic conditions that require regular care. Medicare Advantage plans vary widely in what they charge for doctor visits and related services, so comparisons should be based on actual healthcare needs.

For instance, someone who sees a cardiologist six times a year would pay $300 with a $50 copayment, compared with $210 under a plan charging $35 per visit. If you are unsure how your current coverage stacks up, Chapter’s licensed Medicare advisors can help review available plans based on your doctors, medical needs, and budget.

3. Prescription Drug Deductibles and Copays May Increase

Prescription medications are another area where costs can climb even if premiums fall. According to Medicare.gov, the maximum allowed Part D deductible rises from $615 in 2026 to $700 in 2027, though individual plans may charge less or none at all. Plans can also change formularies, preferred pharmacies, and cost-sharing rules, which may alter what beneficiaries pay for specific medications. The annual out-of-pocket threshold for covered Part D drugs will increase to $2,400 in 2027, up from $2,100 in 2026, although not everyone will reach that level.

Before renewing coverage, enter your medications and preferred pharmacy into the Medicare Plan Finder or speak with a Chapter Medicare advisor to compare prescription options and estimated costs.

4. Your Out-of-Pocket Maximum May Be Higher

One of the key protections in Medicare Advantage is an annual cap on out-of-pocket spending for Medicare-covered Part A and Part B services. But that cap can vary significantly from plan to plan, and a higher limit could leave retirees facing thousands of dollars in additional costs during a serious illness. Federal rules set the maximum allowed amounts, but plans may choose lower limits, so it is important to review the actual number listed in 2027 coverage documents.

Prescription drug costs, monthly premiums, and some other charges generally do not count toward these medical spending limits. Comparing each plan’s out-of-pocket maximum is essential because the financial impact of a major health event can easily outweigh modest premium savings.

5. Out-of-Network Care Could Be Pricier

Provider networks can change from one year to the next, which may affect access to doctors, hospitals, and other facilities. Some Medicare Advantage plans, especially HMOs, generally require members to use network providers for nonemergency care, while PPO plans may allow out-of-network care at a higher cost. KFF’s Medicare Advantage comparison guide recommends confirming that preferred doctors and hospitals participate in a plan before enrolling. It would be a problem to discover that a longtime specialist is no longer in the network after several appointments have already been planned.

Before choosing a plan because the premium is lower, verify your doctors’ network status directly with both the insurer and the providers, or ask a Chapter Medicare advisor to help compare plans that better match your healthcare priorities.

Lower Premiums Do Not Always Mean Lower Total Costs

The projected drop in Medicare Advantage premiums for 2027 is good news, but retirees should remember that national averages do not show what any one person will actually pay. Someone who rarely sees a doctor may do well with a lower-premium plan, while a beneficiary with multiple chronic conditions could face higher costs through copayments, deductibles, and other sharing requirements. Most Medicare Advantage enrollees must also keep paying their Medicare Part B premium, even if their Advantage plan has a $0 monthly premium.

The best approach is to compare your plan’s 2027 Annual Notice of Change with its current benefits, estimate your likely yearly Medicare Advantage costs, and explore alternatives through Medicare.gov, free counseling from the State Health Insurance Assistance Program, or personalized help from Chapter’s licensed Medicare advisors. Chapter is an independent insurance agency, not affiliated with Medicare, and while its advisors can compare plans across the market, it does not offer enrollment in every available plan.